ABA supplies bank revenue fact sheet
(26 October 2011 – Australia) The Australian Bankers’ Association (ABA) said it’s important that Australian banks are profitable, because they provide economic security at a time when global conditions are unstable.
ABA chief executive Steven Münchenberg said a solid and reliable banking system underpins the economy at a time when overseas countries were dealing with high unemployment, poor business conditions, negative economic outlooks and depressed consumer sentiment.
"Unlike overseas, banks here did not fail, nor did they require Government bail outs. Australia’s healthy banks continue to keep our savings safe and to make loans which keep the Australian economy moving."
Due to heightened interest in bank annual profit reports, the ABA produced a fact sheet to answer many of the common questions asked, this includes where the bank revenue comes from, why banks make such large revenues, where the revenue goes, bank costs and benefits from bank profits.
Mr Münchenberg said: "The 'headline' profit numbers of banks appear large because they are very large Australian businesses, yet only two banks feature in the 50 most profitable listed companies in Australia."
"When viewed against the size of the asset base, bank revenue is relatively low. Bank revenue is only about 5 percent of total bank assets. Profits represent just 1.3 percent of bank assets."
Mr Münchenberg said: "In these uncertain times, it is important for banks to be profitable, so that they have some buffers in place which provide resilience against shocks and a cushion against any downturn in economic circumstances."
"Critics, who claim banks are too profitable or who call for a reduction in profits, don’t think through the implications of a weakened banking system, nor are they willing to outline what a safe level of profit should be."
"Unlike overseas, banks here did not fail, nor did they require Government bail outs. Australia’s healthy banks continue to keep our savings safe and to make loans which keep the Australian economy moving."
Due to heightened interest in bank annual profit reports, the ABA produced a fact sheet to answer many of the common questions asked, this includes where the bank revenue comes from, why banks make such large revenues, where the revenue goes, bank costs and benefits from bank profits.
Mr Münchenberg said: "The 'headline' profit numbers of banks appear large because they are very large Australian businesses, yet only two banks feature in the 50 most profitable listed companies in Australia."
"When viewed against the size of the asset base, bank revenue is relatively low. Bank revenue is only about 5 percent of total bank assets. Profits represent just 1.3 percent of bank assets."
Mr Münchenberg said: "In these uncertain times, it is important for banks to be profitable, so that they have some buffers in place which provide resilience against shocks and a cushion against any downturn in economic circumstances."
"Critics, who claim banks are too profitable or who call for a reduction in profits, don’t think through the implications of a weakened banking system, nor are they willing to outline what a safe level of profit should be."
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